Correlation Between Kandi Technologies and Aldel Financial
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Aldel Financial at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Kandi Technologies and Aldel Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and Aldel Financial II, you can compare the effects of market volatilities on Kandi Technologies and Aldel Financial and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Kandi Technologies with a short position of Aldel Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Aldel Financial.
Diversification Opportunities for Kandi Technologies and Aldel Financial
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kandi and Aldel is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Aldel Financial II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aldel Financial II and Kandi Technologies is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Kandi Technologies Group are associated (or correlated) with Aldel Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aldel Financial II has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Aldel Financial go up and down completely randomly.
Pair Corralation between Kandi Technologies and Aldel Financial
Given the investment horizon of 90 days Kandi Technologies Group is expected to under-perform the Aldel Financial. In addition to that, Kandi Technologies is 18.94 times more volatile than Aldel Financial II. It trades about -0.04 of its total potential returns per unit of risk. Aldel Financial II is currently generating about 0.11 per unit of volatility. If you would invest 999.00 in Aldel Financial II on January 10, 2025 and sell it today you would earn a total of 25.00 from holding Aldel Financial II or generate 2.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 24.47% |
| Values | Daily Returns |
Kandi Technologies Group vs. Aldel Financial II
Performance |
| Timeline |
| Kandi Technologies |
| Aldel Financial II |
Kandi Technologies and Aldel Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and Aldel Financial
The main advantage of trading using opposite Kandi Technologies and Aldel Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Aldel Financial can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Aldel Financial will offset losses from the drop in Aldel Financial's long position.| Kandi Technologies vs. Hyliion Holdings Corp | Kandi Technologies vs. Foresight Autonomous Holdings | Kandi Technologies vs. Aeva Technologies, Common | Kandi Technologies vs. Aeye Inc |
| Aldel Financial vs. Drugs Made In | Aldel Financial vs. Voyager Acquisition Corp | Aldel Financial vs. YHN Acquisition I | Aldel Financial vs. YHN Acquisition I |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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